Marketing Management Chapter 10 and 11

STP

Segmentation- a company discovers different needs and groups of consumers in the market place Targeting-addresses those it can satisfy in a superior way Positioning-places its offerings so the target market recognizes its distinctive offerings and images

value proposition

a cogent reason why the target market should buy a product or service; a result of successful positioning

Brand equity focuses

emphasize strategic issues in managing brands and creating and leveraging brand aware and image with customers

brand valuation

estimating the total financial value of the brand; in well known companies brand value is typically more than half the total company market capitalization; US companies don't list on balance sheets but other companies do

brand judgements

focus on customers' own personal opinions and evaluations

slogans

function as useful hooks to help consumers grasp what the brand is and what makes it special

A good brand positioning

helps guide marketing strategy by clarifying the brand's essence, identifying the goals it helps the consumer achieve, and showing how it does so in a unique way.

brand salience

how often and how easily customers think of the brand under various purchase or conumption situations-the depth and breadth of brand awareness

Brand performance

how well the product or service meets customers' functional needs

brand substitution set

if in some marketing activity (an ad campaign, viral video, new product introduction) the brand were replaced by a competitive brand, then the marketing activity would not work as well in the market place

Measuring brand equity

indirect approach -assess potential sources of brand equity by identifying and tracking consumer brand knowledge structures direct approach-asses the actual impact of brand knowledge on consumer response to different aspects of the marketing

basic principle in designing a brand portfolio is to

maximize market coverage so no potential customers are being ignore, but minimize brand overlap so brands are not competing for customer approval

Brand building element choice

memorable, meaningful, likable

Integrated marketing

mixing and matching marketing activities to maximize their individual and collective effects

brand bonding

occurs when customers experience the company as delivering on its brand promise.

Customer equity focuses

on bottom-line financial value

leverageable advantage

one that a company can use as a springboard to new advantages

flag-ship product

one that best represents or embodies the brand as a whole to consumers

Brand characters

one with human characteristics that in turn enhance likeability and tag the brand as interesting and fun; can be animated or real people

Correlational points of parity

potentially negative associations that arise from the existence of positive associations for the brand; if brand is known for inexpensive, can't also be known for quality

emotional branding

refers to the practice of building brands that appeal directly to a consumer's emotional state, needs and aspirations.

Branding Strategy (Brand architecture)

reflects the number and nature of both common and distinctive brand elements. a firm has 3 main choices: 1. develop new brand elements for the new product 2. apply some of its existing brand elements 3. use a combination of new and existing brand elements

Brandz

reveals a brand's current equity and opportunities for growth. there are three different types of brand association that are crucial for building customer predisposition to buy a brand. meaningful, different, and salient. In turn those three dimension is reflected in three important outcome measurements 1. Power - a prediction of the brand's volume shower 2. Premium - a brand's ability to command a price premium relative to the category average 3. Potential - the probability that a brand will grow value share

Branded variants

specific brand lines supplied to specific retails or distribution channels. camera maker will supply low end products to mass merchants and high end products to specialty camera shops

Straddle positioning

straddle two frames of reference to expand market coverage; the POD/POP for one category becomes the POP/POD for the other; if the POD/POP are not credible the brand may not be considered legitimate

brand resonance

describe the relationship customers have with the brand and the extent to which they feel they're in sync with it

Two key components for branding strategy

1. Brand portfolio 2. Brand extension

Monitoring competition

1) share of market - the competitors share of the target market 2) share of mind - the percentage of customers who named the competitor in responding to the statement "name the first company that comes to mind in this industry" 3) Share of heart - the percentage of customers who named the competitor in responding to the statement "name the company from which you would prefer to buy the product Companies that make steady gains in mind share and heart share will inevitably make gains in market share and profitability

Three main ways to convey a brand's category membership

1. Announcing category benefits 2. Comparing to exemplars 3. Relying on the product dicscriptor

three ingredients of customer based brand equity

1. Brand equity arises from differences in consumer response. If no differences occur, the brand-name product is essentially a commodity, and competition will probably be based on price. 2. Differences in response are a result of consumers' brand knowledge, all the thoughts feelings, images, experiences, and beliefs associated with the brands 3. Brand equity is reflected in perceptions, preferences, and behavior related to all aspects of the marketing of the brand

Important principles for internal branding

1. Choose the right moment. Turning points are ideal opportunities to capture employees attention and imagination. 2. Link internal and external marketing. for synergy 3. Bring the brand alive for employees - internal communication should be informative and energizing 4. Keep it simple. Focus on brand pillars, mantras

deciding on a positioning requires

1. Choosing a frame of reference by identifying the target market and relevant competition 2. identifying the optimal points of parity and points of difference brand associations given that frame of reference, including emotional branding 3. creating a brand mantra summarizing the brand's positioning and essence

Designing a brand mantra

1. Communicate-clarify what is unique about the brand; may also need to define the category for the brand and set brand boundaries 2. Simplify-should be memorable i.e, short, crisp, and vivid in meaning 3. Inspire-stake out ground that is personally meaningful and relevant to as many employees as possible.

Establishing a brand position

1. Communicating category membership 2. Communicating POPs and PODs 3. Monitoring competition

Branding Guidelines for Small Businesses

1. Find a compelling product or service performance advantage 2. Focus on building one or two strong brands based on one or two key associations 3. Encourage product or service trial in any way possible 4. Develop cohesive digital strategy to make the brand "bigger and better" 5. Create buzz and a loyal brand community 6. Employ a well-integrated set of brand elements 7. Leverage as many secondary associations as possible 8. Creatively conduct low-cost marketing research

Roles brands play in a portfolio

1. Flankers-positioned so the more important brand can keep their desired position; these brands must be neither so attractive that they take sales away or designed so cheaply to tarnish the other brands 2. Cash cows maintain profitability with virtually no marketing support. 3. Low-end entry level attract customers to the brand franchise 4. high-end prestige to add prestige and credibility to the entire portfolio

Strategic Brand Management Process

1. Identifying and establishing brand positioning and values 2. Planning and implementing brand marketing programs 3. Measuring and interpreting brand performance 4. Growing and sustaining brand equity

Alternative branding strategies

1. Individual or separate family brand names; many consumer packaged goods typically do this. Advantage is if a product fails or appears to be low quality, the company has not tied its reputation to it. 2. Corporate umbrella or company brand name. use their corporate brand as an umbrella brand across their entire range of products. For example GE. Development costs are lower because there's no need to research a name or spend heavily on advertising to create recognition. 3. Sub-brand name (hybrid brand strategy) combine the two or more of the corporate brand, family brand, or individual brand names. Kellog's rice krispies.

5 steps for Interbrands to determine brand value

1. Market segmentation 2. Financial analysis to determine economic earnings. 3. Role of branding-attributes a proportion of economic earnings to the brand in each market segment . Represents the percentage of economic earnings the brand generates. Multiple the Role of Branding by Economic Earnings yields Brand Earnings 4. Brand Strength - assess brand's strength profile to determine the likelihood that the brand will realize forecasted brand earnings. This yields the brand discount rate 5. Brand Value Calculation - the net present value of the forecasted Brand Earnings, discounted by the Brand Discount rate .

Constructing a Brand positioning bullseye

1. POP and POD should be constructed in terms of benefits to the customer 2. POD should be stated in positive aspirational terms 3. Substantiators (RTS/attributes) provide factual or demonstratable support for the POP and POD

framework for narrative branding

1. Setting-time, place, context 2. Cast-the brand as a character 3. Narrative arc 4. Language

brand equity drivers

1. The initial choices for the brand elements or identities making up the brand (brand names, URLs, logos, symbols, characters, spokespeople, slogans, jingles, packages, and signage) 2. The product and service and all accompanying marketing activities and supporting marketing programs. 3. Other associations indirectly transferred to the brand by linking it to some other entity (a person, place, or thing)

the BAV analysis identified three factors that help define energy and the marketplace momentum it creates

1. Vision - a clear direction and point of view on the world and how it can and should be changed 2. Invention - an intention for the product or service to change the way people think, feel, and behave. 3. Dynamism - excitement and affinity in the way the brand is presented

two categories of brand extensions

1. brand mix (brand assortment) 2. Branded variants

7 assets that make up primal code in primal branding

1. creation story 2. creed 3. icon, 4. rituals, 5. sacred words, 6. a way to deal with nonbelievers 7. a good leader

Multiple Frames of Reference

1. develop the best possible positioning for each type/class of competitors and see whether there is a way to create one combined positioning robust enough to effectively address them all. If competition is too diverse, it may be necessary to prioritize the most important competitors and develop POD and POP for them. 2. if there are many competitors in different categories it may be useful to develop the positioning at the categorical level for all relevant categories

advantages of brand extensions

1. facilitate new product acceptance-reduce risk, reduce launch costs, 2. provide positive feedback to the parent brand and company- help clarify the meaning of a brand/its core values/improve consumer loyalty. a successful category extension will reinforce the parent brand and open up a new market, facility more category extensions. iPod and iTunes for apple

disadvantages of brand extensions

1. less associated with any one product 2. if extension is deemed inappropriate, the integrity of the brand may be questions 3. the extension fails and and harms the parent brand 4. Cannabilization of the parent brand from consumers switching from other brands in the portfolio 5. the firm forgoes the chance to create a new brand with its own unique image and equity.

Brand Element Choice Criteria

1. memorable 2. meaningful 3. likable 4. transferable-like amazon becoming more than book seller 5. adaptable 6. protectable-retain trademarks so products can't become ubiquitous with the product category. i.e., kleenex, jello

reasons for introducing multiple brands in a category:

1. need multiple brands in order to pursue multiple segments 2. increasing shelf presence and retailer dependence in the store 3. attracting consumers seeking variety who may otherwise have switched to another brand 4. increasing internal competition in the firm 5. Yielding economies of scale in advertising, sales, merchandising, and physical distribution

marketers classify industry by

1. number of sellers 2. degree of product differentiation 3. presence of absence of entry, mobility and exit barriers, 4. cost structure 5. Degree of vertical integration 6. Degree of globalization

the ideal brand association is

1. preemptive 2. defensible 3. difficult to attack

brand value chain multipliers

1. program multiplier determines the marketing program's ability to affect the customer mind-set and is a function of the quality of the program investment 2. customer multiplier determines the extent to which value created in the minds and hearts of customers affects marketing performance. Depends on competitive superiority. 3. market multiplier determines the extent to which the value shown by the market performance of a brand is manifested in shareholder value; depends in part on the actions of financial analysts and investors

Brands Role for Firms

1. simplify product handling 2. organize inventory & accounting 3. offer legal protection 4. create brand loyalty 5. secure competitive advantage

5 elements of narrative branding

1. the brand story in terms of words and metaphors 2. the consumer journey or the way consumers engage with the brand over time and touch points where they come into contact with it 3. the visual language or expression for the brand 4. the manner in which the narrative is expressed experientially or the brand engages the senses 5. the role the brand plays in the lives of consumers

In order for brand equity to perform a useful strategic function and guide marketing decisions, marketers need to fully understand

1. the sources of brand equity and how they affect outcomes of interest (brand audit) 2. how these sources and outcomes change , if at all, over time.(brand checking)

marketers can reinforce brand equity by consistently conveying the brand's meaning in terms of

1. what products it represents, what core benefits it supplies, and what needs it satisfies 2. how the brand makes products superior and which strong, favorable, and unique brand associations should exist in consumers' minds

brand (AMA)

A name, term, sign, symbol, or design, or a combination of them intended to identify the goods and services of one seller or group of sellers and to differentiate them from those of the competition; These difference may be functional, rational, or tangible (related the product performance) or it may be symbolic, emotional or intangible (related to what the brand represents or what it means in a more abstract sense)

Branding Decisions

Alternative branding strategies house of brands vs. a branded house

means of differentiation

Any product or service benefit that is sufficiently desirable, deliverable, and differentiating can serve as a point of difference for a brand.

Points-of-parity (POPs)

Attribute/benefit associations that are not necessarily unique to the brand but may in fact be shared with other brands; consumers need to see the brand as good enough, not necessarily equal to other brands

Category points of parity

Attributes or benefits that consumers view as essential to a legitimate and credible offering within a certain product or service category; they represent necessary but not sufficient conditions for brand choice

Narrative Branding

Based on deep metaphors that connect to people's memories, associations, and stories.

Managing Brand Equity

Brand Reinforcement - continually moving brand forward, providing consistent marketing support. Brand Revitalization - continuum from back to basics to reinvention; challenge is to not alienate old customers while still attracting new ones

Leveraging secondary associations

Create brand equity by linking the brand to other information in memory that comveys meaning to consumers.

competitive frame of reference

Defines which other brands a brand competes with and which should thus be the focus of competitive analysis

Brand Strength

Energized differentiation and Relevance - a leading indicator that predicts future growth value

Brand Stature

Esteem and Knowledge - a report card of past performance and a lagging indicator of current operating value

BrandAsset Valuator (BAV)

Four components of (pillars) of brand equity 1. Energized differentiation measures the degree to which a brand is seen as different from others as well as its pricing power 2. Relevance measures the appropriateness and breadth of a brand's appeal 3. Esteem measures perceptions of quality and loyalty, or how well the brand is regarded and respected 4. Knowledge measures how aware and familiar consumers are with the brand and the depth of their experience.

Millward Brown maintain that a brand's financial success depends on its ability to be

MD&S (meaningful, different, and salient) and measured by 3 brand equity metrics 1. power predicts volume share based entirely on perceptions (absent of activation factors) 2. premium predicts the price index your brand can command 3. potential indicates the likelihood of value share growth for the brand in the next 12 months based on people's predisposition to stick to the brand or try it in the future.

Rayport and Jaworski suggesting for profiling direct and indirrect competitors

Mapping the buyer's steps in obtaining and using the product. This type of analysis highlights both the opportunities and the challenges a company faces

Power grid (from BAV)

Strength of y axis and stature on x axis; depicting stages in the cycle of brand development; New/unfocused- lower left quadrant Niche/momentum-upper left quadrant leadership-upper right quadrant eroding/declining-lower right quadrant

customer equity

The sum of lifetime values of all customers; Is affected by customer acquisition, retention, and cross-selling

brand protective elements choice

Transferable, adaptable, protectable

brand attributes

descriptive features that characterize a product or service; provides reasons to believe or proof points as to why the brand can claim their benefits

Negative Customer-Based Brand Equity

When consumers react less favorably to marketing activity for the brand compared with an unnamed or fictitiously named version of the product.

positive customer based brand equity

When consumers react more favorably to a product and the way it is marketed when the brand is identified than when it is not.

three critera determine whether a brand association can truly function as a point of difference:

desirability, deliverability, and differentiability

Brand audit

a focused series of procedures to assess the health of the brand, uncover its sources of brand equity, and suggest wayts to improve and leverage its equity. Conduct a this when when setting up marketing plans and when considering a shift in strategic direction. Conduct this on a regular basis allows marketers to keep their finger on the pulse of the brand to manage more proactively and resposively. Provides keen insights into consumers, brands, and the relationship between the two. Where the brand has been

industry

a group of firms producing products that are close substitutes

creating a compelling, well-differentiated brand position requires

a keen understanding of consumer needs/wants company capabilities competitive actions disciplined but creative thinking

sub-brand

a new brand combined with an existing brand

master brand/family brand

a parent brand that is already associated with multiple products through brand extensions

Brands Role for Consumers

a promise between the firm and the consumer. it is a means to set consumers' expectations and reduce their risk. In return for customer loyalty, the firm promises to reliably deliver a predictably positive experience and set of desirable benefits with its products and services; key is to fulfill or exceed customer expectation in satisfying their needs/wants

brand mantra

a short 3-5 word phrase that captures the irrefutable essence or spirit of the brand positioning; designed with internal purposes in mind

brand value chain

a structured approach to assessing the sources and outcomes of brand equity and the way marketing activities create brand value

brand contact

any information bearing experience, whether positive or negative, a customer or prospect has with the brand, its product category, or its market.

What can be brands?

anywhere a consumer has a choice physical good a service a store a person a place an organization or an idea

Brand elements

are devices, which can be trademarked, that identify and differentiate the brand. Most strong brands employ multiple brand elements.

Competitive points of parity

associations designed to overcome perceived weaknesses of the brand in light of competitors points of difference

Points of difference (POD)

attributes or benefits that consumers strongly associate with a brand, positively evaluate, and believe they could not find to the same extent with a competitive brand; strong brands usually have multiple POD

Most new products are

brand extensions

competitors (marketing version)

companies that satisfy the same customer need. by using the marketing concept it reveals a broader set of actual and potential competitors than competition defined in just product category terms

Deliverable by the company (POD)

company must have the internal resources and commitment to feasibly and profitably create and main the brand association in the minds of consumers

Branding is a way to secure a

competitive advantage

Internal branding

consists of activities and processes that help inform and inspire employees about brands. can even go further and train and encourage distributors and dealers to serve their customers well.

Desirable to consumer (POD)

consumer see the brand as personally relevent to them

Differentiating from competitors (POD)

consumers must see the brand association as distinctive and superior to relevant competitors

brand feelings

customers' emotional responses and reactions with respect to the brand

Positioning

the act of designing a company's offering and image to occupy a distinctive place in the minds of the target market. Goal is to locate the brand in the minds of consumers to maximize the potential benefit to the firm.

brand equity

the added value endowed to products and services with consumers

customer base brand equity

the differential effect brand knowledge has on consumer response to the marketing of that brand

parent brand

the existing brand that gives birth to a brand extension

brand imagery

the extrinsic properties of the product or service, including the ways in which the brand attempts to meet customers' psychological or social needs

brand promise

the marketer's vision of what the brand must be and do for consumers

Interbrand's definition of brand value

the net present value of the future earnings that can be attributed to the brand alone

Branding

the process of endowing products and services with the power of a brand Creates mental structures that help consumers organize their knowledge about products and services in a way that clarifies their decision making.

category membership

the products or sets of products with which a brand competes and which function as close substitutes

brand mix (brand assortment)

the set of all brand lines that a particular seller makes

brand portfolio

the set of all brands and brand lines a particular firm offers for sale in a particular category or market segment

branded house

the use of an umbrella corporate or company brand name.

house of brands

the use of individual or seperate family brand names

think of brand equity as providing marketers with a vital strategic bridge from

their past to their future

role of brand mantra

they create a mental filter to screen out brand-inappropriate marketing activities or actions of any type that may have a negative bearing on customers' impressions

Competitive advantage

to perform in one or more ways that competitors cannot or will not match; not inherently sustainable, but can be leveraged

authenticity in branding evokes

trust, affection, and strong loyalty

Brand tracking studies

use the brand audit as input to collect quantitative data from consumers over time, providing consistent, baseline information about how brands and marketing programs are performing. Helps us understand where, how much and in what ways brand value is being created to facilitate day-to-day decisions making where the brand is now if marketing programs are having the intended effects

Brand Resonance Model

views brand building as an ascending series of steps 1. Identity; who are you? deep , broad brand awareness **salience** 2. Meaning: who are you? POP and POD **performance and imagery** 3. Response: what about you? positive accessible reactions **judgements and feelings** 4. Relationships: what about you and me? intense active loyalty **resonance** This model emphasizes the duality of brands - rational route on the left, emotional route on the right

primal branding

views brands as complex belief systems

Perceptual maps

visual comparison of customer perceptions and preferences

brand extension

when a firm uses an established brand to introduce a new product

brand dilution

when consumers no longer associate a brand with a specific or highly similar set of products and start thinking less of the brand

preemptive cannibalization

when consumers switch to a line extension might have otherwise switched to a competing brand

licensed product

whose brand name has been licensed to other manufacturers that actually make the product